As per Deloitte, in 2021, the number of hotel rooms in Saudi Arabia will increase by 4,500. Therefore, with the growth in the hospitality sector, the revenue in the Saudi Arabian heating, ventilation, and air conditioning (HVAC) market is predicted to increase from $2,709.0 million in 2019 to $3,197.4 million by 2030, at a 3.2% CAGR between 2020 and 2030, according to the market research report published by P&S Intelligence. In 2019, the largest hotel of the InterContinental Hotel Group in the Kingdom, with 4,200 rooms, was opened in Mecca.
Another such development, which would help the Saudi HVAC market advance, is Hilton Worldwide Holdings Inc.’s 2019 decision to construct 35 new hotels in the country in the next five years. In the same vein, Radisson Hospitality AB expects to inaugurate Radisson Riyadh Airport Hotel by 2020. The major reason behind the surging number of hotels in the country is its religious significance, which brings loads of pilgrims and tourists here every year.
In 2021, the number of hotel rooms in Saudi Arabia will increase by 4,500.
The Saudi Arabian HVAC market is witnessing slow growth on account of the Covid-19 pandemic, as the manufacturing and supply of HVAC systems have halted. Moreover, due to the lack of funds and workforce, construction activities have stopped. On the individual level, many people are facing pay or job cuts, which is why they are only purchasing essential goods, thereby leading to a reduced demand for HVAC systems and services.
In the past, the largest share in the Saudi HVAC market was held by the upgradation/replacement division, under the service segment. In order to keep the systems running efficiently, people are regularly upgrading or replacing them. In addition to operational efficiency, upgradation/maintenance also ensures low energy consumption and cleaner environs by tackling the accumulation of bacteria and mold on the systems’ vents.
The central region has four cities with a population of over a million
Historically, the largest revenue contributor to the Saudi HVAC market was made by the country’s central region, which is home to some of its largest and most populous cities, including its capital – Riyadh. In all, the central region has four cities with a population of over a million, 20 cities with a population of 100,000–1 million, and 45 cities with a population of 10,000–100,000.
The western region is expected to experience the fastest growth in the Saudi Arabian HVAC market during the next decade. Mecca and Medina are both located here, and they, along with Jeddah and Tabuk, have a number of infrastructure projects under various stages of implementation. Many of these projects are being executed under Saudi Vision 2030, which is aimed at diversifying the Kingdom’s economy.